21 ATTACHMENT 3 - Laserfiche WebLink

82 Permits and Regulation Non-compliance with discharge permits may result in significant penalties from the SWRCB or other enforcement actions that could have a material adverse effect on the finances and operations of LAVWMA and the Members. Changes in regulation could increase the costs of operating the LAVWMA Enterprise and the Member’s Sewer Systems. See “THE LIVERMORE- AMADOR VALLEY WATER MANAGEMENT AGENCY – Permits and Regulations.” Abatement The Sewer Service Contract provides that Payments for Fixed LAVWMA Maintenance and Operation Costs under the Sewer Service Contract are subject to abatement in the discretion of the Members during any period in which by reason of any damage or destruction (other than by condemnation, which is provided for separately in the Indenture; see Appendix D) there is a material interruption in the Sewer Service to the Members. Abatement will continue for the period commencing with the damage or destruction and ending upon the restoration of Sewer Service by LAVWMA. The proceeds of any insurance covering such damage or destruction are required to be deposited and applied by LAVWMA as provided in the Indenture. See “SECURITY FOR THE 2021 BONDS - Insurance”. Under the Sewer Service Contract, LAVWMA covenants, to the extent permitted by law and subject to any limitations resulting from a disruption in pipeline capacity, to accept wastewater of Members notwithstanding any disruption in pipeline capacity and to use its best efforts in the event of any such disruption to undertake alternative and interim methods of storage and disposal of wastewater, including San Lorenzo Creek and Alamo Creek. See “THE LIVERMORE-AMADOR VALLEY WATER MANAGEMENT AGENCY – Permits and Regulations.” The Members’ Payments for their Fixed Cost Allocation for Debt Service are not subject to abatement. Dependence of Connection Fee Revenue on Development The projections relating to the payment of Expansion Project Debt Service on the 2021 Bonds by DSRSD, on behalf of itself and Pleasanton, and the payment of Payments by Livermore under the Sewer Service Contract assume that some revenue will be generated as a result of the collection of connection fees. See “DUBLIN SAN RAMON SERVICES DISTRICT,” “CITY OF PLEASANTON” and “CITY OF LIVERMORE.” In general, receipt of connection fee revenue is dependent upon development of land. See “PLANNED DEVELOPMENT IN THE LAVWMA SERVICE AREA.” The actual course of land development within the Members’ service areas may vary significantly from the projections. Although the Members assume they will collect connection fee revenue, wastewater service charges are the ultimate financial support for the payment of the Payments under the Sewer Service Contract. In general, the Members agree annually to set rates for wastewater service charges at a level which will generate revenues sufficient to cover annual debt service on the 2021 Bonds (with an allowance for amounts transferred from the Rate Stabilization Fund to pay the Expansion Debt Service on the 2021 Bonds). See “SECURITY FOR THE 2021 BONDS - Rate Covenants.” Land development is subject to comprehensive federal, state and local regulations. Approval is required from various agencies in connection with the layout and design of developments, the nature and extent of improvements, construction activity, land use, zoning,